What Everyone Needs To Know About Secured Credit Cards

in blog •  7 years ago  (edited)

A secured credit card offers a line of credit backed by your own funds. The credit card company that approves you provides specific instructions about the minimum and maximum amount of money you can add to your account, and that money becomes your credit line.


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For example, a secured credit card company might say you can deposit between $300 and $2,000 toward your credit line. You decide to deposit $500, so you have $500 available to spend. If you rack up $450 in charges, you only have $50 left until you make a payment on the card. This frees up some - or all - of your approved credit line, and then you can repeat the process as desired.


LEARN MORE ABOUT SECURED CARDS HERE
▻4 BEST SECURED CREDIT CARDS FOR BUILDING CREDIT◅

Is a secured credit card the same as a prepaid debit card?
Technically the answer to this question is no, but we get why some people think secured credit cards and prepaid debit cards are the same. Both cards typically share a few common traits, including:

↪ A distinguishable logo, such as Visa or MasterCard, on the front
↪ Self-funded spending limits
↪ Acceptance online and at brick-and-mortar stores

However, there’s one major difference: Secured credit cards usually show up on your credit report, and prepaid debit cards don’t. Another difference is that you can spend as much money as you want (as long as you don’t exceed your card’s deposit value or limits) with a prepaid debit card, but you’re stuck with a predetermined credit line when you use a secured credit card.

LEARN MORE ABOUT SECURED CARDS - CLICK HERE
Can I get a secured credit card with no deposit?
How is a secured credit card different from an unsecured credit card?
Why would someone want a secured credit card?
Are secured credit cards for people with bad credit?
What is the best-secured credit card?
The Application Process
Do I pay interest on my purchases if I have a secured card
Do secured credit cards really help your credit?
LEARN MORE ABOUT SECURED CARDS - CLICK HERE


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